Global Crypto Reporting Framework Welcomes South Korea as Latest Member, Following Their Agreement with OECD

South Korea has announced its plans to join a global initiative aimed at enhancing transparency in the crypto sector. The Crypto-Asset Reporting Framework (CARF), a structure for exchanging tax-related information on digital asset transactions across borders, will be implemented in South Korea starting in 2026.

The new policy targets both domestic and foreign crypto transactions, with the international exchange of crypto transaction data scheduled to begin in 2027. This move is in line with the efforts of countries like Germany, the United Kingdom, and Japan, which are also preparing for the CARF rollout.

The South Korean government has signed a deal with the Organisation for Economic Co-operation and Development (OECD) to adopt this global crypto reporting system. The initiative aims to strengthen efforts to monitor digital assets globally.

The policy marks a shift toward tighter oversight of cross-border crypto trading activity. Under CARF, South Korea will collect transaction data from local crypto exchanges like Upbit and Bithumb. The National Tax Service will receive information on South Korean investors trading on overseas platforms, which will feed into a centralized system managed by the OECD.

The policy does not specify if this will lead to a decrease in trading volume, but users who value privacy might start abandoning controlled platforms. Detailed regulations for CARF are expected to be developed through an administrative notice later this month.

The agreement focuses solely on information sharing under international rules, not on taxation laws. However, the South Korean government has also announced plans to impose crypto taxation starting January 2025.

This move towards increased transparency is part of a wider international partnership. During the OECD Global Forum in 2023, 48 countries signed the agreement, indicating a wide international partnership. Future partner countries potentially include other OECD members or crypto-friendly jurisdictions actively developing regulatory frameworks and reporting standards.

South Korea's Ministry of Economy and Finance confirmed the agreement this week. The policy intends to enhance tax transparency and reduce global tax evasion tied to crypto. The timeline for the implementation of new compliance demands for domestic exchanges in South Korea starts next year.

In a separate development, South Korea's leading digital asset exchange, Upbit, added Sahara token trading pairs earlier this year as part of its strategy to support emerging tokens. This move reflects Upbit's commitment to staying at the forefront of the rapidly evolving crypto market.

As the crypto landscape continues to evolve, South Korea's implementation of CARF is a significant step towards global regulatory cooperation and transparency in the digital asset sector.